Biden Set To Sign Executive Order To Address Chip Shortages, Supply-Chain Crisis: WSJ

Biden Set To Sign Executive Order To Address Chip Shortages, Supply-Chain Crisis: WSJ
  • President Joe Biden is close to signing an executive order reviewing supply chains for critical materials, including semiconductors to pharmaceuticals and rare-earth minerals, the Wall Street Journal reports.
  • The global semiconductor chip crisis has compelled U.S. automakers, including Ford Motor Co (NYSE: F) and General Motors Co (NYSE: GM) and other manufacturers, to opt for production holidays.
  • Recently a group of U.S. chip companies, including Intel Corp (NASDAQ: INTC), Qualcomm Inc (NASDAQ: QCOM), Micron Technology Inc (NASDAQ: MU), and Advanced Micro Devices Inc (NASDAQ: AMD), sought Biden’s assistance to solve the crisis.
  • Biden is slated to meet with a bilateral group of House and Senate lawmakers to discuss the pandemic-induced supply-chain issues.
  • The executive order is estimated to seek a 100-day supply chain review in four areas, including semiconductors used in products from cars to phones, large-capacity batteries for electric vehicles, pharmaceuticals, and vital rare-earth elements for technology and defense.
  • Interestingly, China rules the rare-earths market and is a major player in multiple supply areas, including pharmaceuticals. The order is timed when the U.S. intends to forge ties with different supplier countries and shun relations with China.
  • Major U.S. semiconductor companies have outsourced their chip production to Taiwan Semiconductor Manufacturing (NYSE: TSM) and Samsung Electronics Co Ltd (OTC: SSNLF). Samsung has been assured federal incentives in return for a factory in New York. TSM recently disclosed plans for a $12 billion chip plant in Arizona to come online by 2024.
  • The order is estimated to seek a one-year review of supply chains encompassing six sectors, from technology to food production.
  • The order will be focused on domestic production with incentives including job-training programs and business loans, including the federal procurement process for more American-made purchases. It will also include certain import limitations.
  • The Defense Production Act, covering vaccine production, could also be a part of the order. The government is expected to focus on public-private partnerships while improving relations with allies to address common supply vulnerabilities, including semiconductors.
  • The executive order will be linked to Biden’s plans towards U.S. job creation, mainly in the manufacturing sector that has faced intense foreign competition.
  • The long-term executive order is expected to incorporate the short-term chip crisis.
  • On Monday, Taiwan’s Economic Minister Wang Mei-Hua acknowledged receipt of a letter from the White House on the global shortage of auto chips and assured a resolution.
  • Image Courtesy: Wikimedia

Posted In: Joe BidenWall Street JournalGovernmentNewsTechMedia

Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.

All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.

Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.

Rate collection and criteria: Click here for more information on rate collection and criteria.